Carefree Company’s newly hired assistant prepared the following bank reconciliation on March

31, 2006:

Book balance 1,405,000

Add: March 31 deposit 750,000
Collected of note 2,500,000
Interest on note 150,000 3,400,000
Total 4,805,000
Less: Careless Company’s deposit to account 1,100,000
Bank service charge 45,000 1,145,000
Adjusted book balance 3,660,000
Bank balance 5,630,000
Add: Error on check No. 175 45,000
Total 5,675,000
Less: Preauthorized payments for water bill 205,000
NSF check 220,000
Outstanding check 1,650,000 2,075,000
Adjusted bank balance 3,600,000
Check No. 175 was made for the proper amount of P249,000 in payment of account. However
it was entered in the cash payments journal as P294,000. Carefree authorized the bank to
automatically pay its water bills as submitted directly to the bank.

8. the correct cash in bank balance is

The bookkeeper of Divine Company recently prepared the following bank reconciliation on
December 31, 2006:

Balance per bank statement 2,800,000

Add: Deposit in transit 195,000
Checkbook printing charge 5,000
Error made by Divine in recording check No.45
(issued in December)
 35,000
NSF check 110,000 345,000
3,145,000
Less: Outstanding check 100,000
Note collected by bank

(includes P15,000 interest) 215,000 315,000

Balance per book 2,830,000
Divine Company has P200,000 cash on hand on December 31, 2006.

9. The amount to be reported by Divine Company as cash on the balance sheet as of December
31, 2006 should be